Tax changes affecting Ugandan companies, employers and sole proprietors. Sourced from the Uganda Revenue Authority, the Parliament of Uganda and NSSF. Where a change is not yet confirmed as in force, the entry says so.
In force1 July 2026
payroll
PAYE tax-free band raised to UGX 335,000
The Income Tax (Amendment) Act, 2026 raised the resident monthly tax-free band from UGX 235,000 to UGX 335,000, with new 20%, 25% and 30% bands.
What changed and what to do
What changed
Resident monthly bands from 1 July 2026: nil up to 335,000; 20% to 410,000; 15,000 plus 25% to 485,000; 33,750 plus 30% above; an extra 10% above UGX 10 million. The Act was assented on 20 August 2026 with effect from 1 July 2026.
Who it affects
Every employer running payroll
Employees
What to do
Update payroll to the new bands and amend July and August 2026 PAYE returns filed at the old rates.
From 1 July 2026 the annual VAT registration threshold is UGX 300 million, up from UGX 150 million, and a business must also register if its turnover in any three consecutive months passes UGX 75 million.
What changed and what to do
What changed
The annual threshold rose from UGX 150 million to UGX 300 million, and the three-month test rose from UGX 37.5 million to UGX 75 million. The change is in an Act that is in force.
Who it affects
Businesses with turnover between UGX 150 million and 300 million
Businesses deciding whether to register
What to do
Check both the annual and the three-month test before deregistering or deciding not to register.
From 1 July 2026 a designated VAT withholding agent does not withhold VAT on payments to a supplier who issues an EFRIS e-invoice or e-receipt.
What changed and what to do
What changed
The VAT (Amendment) Bill, 2026 removes VAT withholding where the supplier issues an EFRIS invoice or receipt, so suppliers using EFRIS receive the full VAT.
Who it affects
Suppliers to designated VAT withholding agents
Designated agents
What to do
Issue EFRIS invoices to every customer; agents stop withholding VAT on EFRIS-invoiced supplies.
From 1 July 2025 non-VAT-registered taxpayers in twelve gazetted sectors must use EFRIS.
What changed and what to do
What changed
EFRIS, already mandatory for VAT-registered businesses, now covers non-VAT taxpayers in twelve gazetted sectors. Businesses in those sectors with turnover under UGX 10 million a year are exempt.
Who it affects
Non-VAT businesses in the gazetted sectors
Their customers, who need EFRIS invoices to deduct costs
What to do
Check whether your sector is on URA's list and register on EFRIS.
FY 2026/27 tax amendments in force from 1 July 2026
The FY 2026/27 package amends the Income Tax, VAT, Excise, Stamp Duty, Tax Procedures Code, Lotteries and Gaming and external trade laws, effective 1 July 2026.
What changed and what to do
What changed
URA confirmed the Income Tax (Amendment) Act, 2026 and the Excise Duty (Amendment) Act, 2026 take effect from 1 July 2026. URA says PAYE, withholding tax, VAT and other returns for July and August 2026 may need adjusting.
Who it affects
Every taxpayer filing returns for July 2026 onwards
What to do
Read URA's FY 2026/27 amendments page and check July and August 2026 returns.